As Microsoft Corp. (Nasdaq: MSFT) moves ahead on its $5 billion headquarters expansion in Redmond, questions linger around some of the Bellevue office spaces it's leaving behind.
The tech giant confirmed in September it will not renew the lease in the two Bravern office towers in downtown Bellevue that are set to expire next year, leaving behind almost 750,000 square feet of space. According to recent loan servicer reports, Microsoft has already vacated the space but will be paying rent until the last lease expires in August 2025.
Scheduled monthly payments on the property's mortgage debt have averaged $825,028 this year, according to servicer reports. The most recent payment was $838,553.
An LLC associated with the property owner, Invesco, owed $304 million on three separate loans secured by the property as of August, according to financial filings. Plans to fill the offices, located on the 11000 block of Northeast Eighth Street, before the loans mature in January 2027 remain unclear. Invesco and Microsoft declined to comment on the Bravern towers.
The Broderick Group is marketing both towers on its website. The firm said in a statement to the Business Journal it is working with KG Investment Properties on the Bravern office towers. Shawn Gilson, general manager at KG, said in a statement the firms are designing amenities for the Bravern, and those renovations will start once Microsoft's lease expires next year.
"We are very excited about the changes to come at the Bravern. It is a well-known property and an icon of the Bellevue skyline," Gilson said in an emailed statement. "The Bellevue office market is unique in that currently there is strong leasing activity in the Class A+ product. It's an exciting time in Bellevue real estate."
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The smaller Bravern tower, at 11155 NE Eighth St., has 255,171 rentable square feet, while the larger one, at 11025 NE Eighth St., has 494,523 rentable square feet. Microsoft has leased all the office space in the two towers. The block also has retail space, called the Shops at the Bravern, and two apartment buildings.
Microsoft had about 1,600 employees at the Bravern office towers as of last year, according to Business Journal reporting. The loan servicer reports note Microsoft gave official notice it wasn't renewing its lease to Invesco at the end of June.
Atlanta-based investment management company Invesco, through its real estate arm, in 2020 announced it had bought the office properties from Principal Real Estate and PNC Realty. In addition to the office towers, Invesco also owns parking at the site. The properties had an appraised value of $605 million as of 2019.
Microsoft has been steadily shedding space in Bellevue as it consolidates in its Redmond headquarters, which is undergoing a $5 billion expansion. In total, Microsoft plans to leave more than 2 million square feet in Bellevue, including high-profile exits like the Advanta Office Commons and City Center Plaza.
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